Hassan’s budget: A casino, more money for mental health and higher education, a new women’s prison

Governor Maggie Hassan looks to Speaker of the House Terie Norelli after being sworn in as the 81st Governor of New Hampshire on Thursday, January 3, 2013 at the State House.
(JOHN TULLY / Monitor Staff)

Gov. Maggie Hassan told the Legislature this morning she wants to raise the cigarette tax and allow casino gambling in New Hampshire to help strengthen mental health services, build a new women’s prison and increase state aid to public colleges and universities.

Hassan presented her proposed budget for the coming biennium, fiscal years 2014 and 2015, to a joint session of the House and Senate this morning.

“The revenue from one casino would mean tens of millions of dollars a year that can be used to strengthen our economy and address our priorities, such as freezing in-state tuition and addressing our mental health crisis, as well as funds to address social costs like substance abuse and gambling addiction,” Hassan said, according to her prepared remarks.

Hassan’s proposed budget would increase general fund spending in the next biennium by 7.1 percent, from more than $2.6 billion to nearly $2.8 billion, from the current biennium, counting actual spending for fiscal 2012 and budgeted spending for fiscal 2013.

Counting all state funds, including federally financed programs, spending would rise 10.2 percent, from nearly $10.1 billion to nearly $11.1 billion, in the next biennium.

Hassan’s budget assumes baseline revenue from state business and other taxes will rise 2 percent in fiscal 2014 from the current fiscal year, and rise 1.9 percent in fiscal 2015 from fiscal 2014.

She also wants to hike the cigarette tax, which was cut 10 cents in the budget passed two years ago. Hassan’s budget would reverse that cut and raise the tax an additional 20 cents, to $1.98 per pack. (That would still be the lowest tobacco tax in New England, just below Maine’s $2 per-pack tax, according to the Campaign for Tobacco-Free Kids, an advocacy group.)

Her budget would also repeal the state’s new education tax credit program and suspend a number of pending changes to state tax laws.

But the big source of new revenue in Hassan’s budget is a single casino, which she projects would bring in $80 million in licensing fees over the biennium.

That element of her budget is bound to be controversial, especially in the House, where many proposals for expanded gambling have died over the years.

Where would the money go? She’s proposing big increases in state aid for the University System of New Hampshire and the Community College System of New Hampshire. Community colleges would get $40 million in fiscal 2014 and $42 million in fiscal 2015, and the state university system would get $75 million in fiscal 2014 and $90 million in fiscal 2015.

For the university system, that’s still less than the $100 million a year it received from the state before big cuts in the budget passed two years ago. But Hassan said in her speech that officials from both systems have assured her they will seek to freeze in-state tuition in exchange for the funding hikes.

And Hassan would funnel more money into mental health services, including a new 16 bed short-term acute treatment center, a new 10 bed receiving facility and increased support for community services and housing programs.

“We can all agree that our mental health system is deeply strained,” Hassan said. “And though we won’t fix all of our challenges at once, it is time to resume our efforts to repair our mental health system. We must phase in changes with a systematic approach that will strengthen all aspects of mental health care in our state and move us toward more community-based care.”

Hassan’s budget would also, among other things, expand the state’s Medicaid program, continue the implementation of a managed care system for Medicaid, increase uncompensated care payments to state hospitals, fill 10 vacant state trooper jobs, fund two new superior court judges and spend $38 million to build a new women’s prison.

It would also reform the state Liquor Commission, changing it from a three-member commission to a department with a single commissioner.

The budget doesn’t address any additional money for road paving, bridge repairs or the ongoing widening of Interstate 93. There are bills pending in the Legislature to fund those projects, including options that would use casino revenue or increases in the gas tax and vehicle-registration fees.

“I stand ready to work with any member of either party who is willing to bring constructive, long-term ideas to the table so we can build a consensus solution that will help us begin to improve our roads and bridges and finish I-93,” Hassan said in her speech.

The budget now goes to the Democratic-led House, then to the Republican-led Senate. The next biennium begins July 1.

For complete coverage and analysis of Hassan’s budget, and reaction from key policymakers, see tomorrow’s Monitor.

(Ben Leubsdorf can be reached at 369-3307 or bleubsdorf@cmonitor.com or on Twitter @BenLeubsdorf.)

Gov. Maggie Hassan this morning unveiled her proposed two-year state budget in a speech to a joint session of the House and Senate at the State House in Concord. Below is the text of Hassan’s speech, as prepared for delivery: --- Madam Speaker, Mr. Senate President, Madam Chief Justice, honorable members of the House, Senate and Executive Council, my fellow …